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Patrick H.
Patrick H., Lawyer
Category: Australia Law
Satisfied Customers: 5361
Experience:  Dip Law LPAB - Sydney based lawyer
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How enforceable is a non competitive clause in an employment

Customer Question

Customer: How enforceable is a non competitive clause in an employment contract
JA: Thanks. Can you give me any more details about your issue?
Customer: My husband was employed for 6 months than made redundant. How he wants to work for his former employers competitor & he claims he have to respect the one year restraint of trade clause or he will take us to court
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Submitted: 11 months ago.
Category: Australia Law
Expert:  Patrick H. replied 11 months ago.

Hello and thank you for your question.

In Australia restraint of trade clauses are generally enforceable only to the extent reasonably required to protect the legitimate interests of the employer in whose favour they were drafted. If the clause is there and necessary to protect the company's commercial secrets, for example, client lists, technology, etc, then it may well be enforceable in full. If it is just to create a disinsentive for workers to leave the company or to restrict competition, then these are not legitimate reasons for such a clause and such a clause will then be read down or struck out by a court.

The courts are generally very conscious that people have to earn a living and therefore reluctant to enforce contractual terms that have the effect of preventing a person from obtaining employment and in practice will usually only strictly enforce such terms for very highly paid exectutives or technical people.

I trust the above assists your understanding and if you have a follow up question please ask.

I could perhaps provide more specific advice if I had more information regarding your husband's work situation and access to a copy of his contract, though reviewing his contract would require a further fee given the work that would involve.

If you have no follow up question, PLEASE RATE MY ANSWER.

Thanks and good luck.

Patrick

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